Fathers Passing the Baton to Daughters: How Succession Planning Happens in Family-Run Organizations

April 19, 2018

By Alison Gutterman

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It’s doubtful that my dad thought I would run the family business when I was a little girl dancing on his feet in our kitchen. In fact, the topic of succession with my sister and me never came up at dinner. And even after I started working for Jelmar, he joked that my mom should sell the company if he died. (I didn’t take it personally.)

In other words, he was a bit blinded at first by what I call "little girl syndrome" (maybe it'll gain some scientific relevance someday) — something that makes it difficult for many fathers to see their daughters as legitimate heirs to the corporate reins. When my father started in the business, he worked 12-hour days, driving across the country and carrying his sample bag filled with products up and down the stairs of various retailers. He expected me to prove my worth to him and the company like he did to his father, much like sons like to one-up their dads during a friendly one-on-one game of basketball.

But the dynamics of the father-daughter relationship aren't the same as the father-son relationship. Just as he was when he started, I was smart, loyal, and passionate, but I didn’t plan to “fight” him for the business the way he had with his father. Despite being competitive myself, I don't view competitiveness as combativeness. Yet here I am. We bucked the trend and discovered that passing the baton from dad to daughter has some amazing advantages.

Interestingly, our path mirrors that of other CEO dads who didn’t plan to pass on the family business to their daughters. Fortunately, I believe the tide is slowly changing, though statistics for daughters taking on leadership at family companies aren't as positive as you might expect. In fact, just 24 percent of family-owned organizations have a woman at the helm. Could that be one of the reasons why only 12 percent of family-run businesses survive to generation three?

To be sure, most women do not bring the same perspectives and qualities to a C-suite role as their male counterparts. And you know what? That’s great for companies that want to thrive in today’s marketplace.

Daughter CEO Strengths

Even today, my father tells me I’m an eternal optimist — and he’s right. As a kid, I could bounce back after failure, sure that something good would happen if I worked hard enough and continued to put people first. My personality stands in stark contrast to his, which is why we’ve continued to thrive. I didn’t come into my position with the same biases he had; I brought a new sense of positivity and a fresh set of eyes. I also fostered an atmosphere that wasn’t based on or limited by gender.

Research shows that the more women you have at the top of an organization, the more women stakeholders continue to climb the corporate ladder. As new top female talent comes into the business, their chances to snag senior positions increase. And the company enjoys versatility, diversity, flexibility, and, at least in our case, profitability.

An example of my unique perspective is a passion for environmentalism and corporate philanthropy. Since 2006, I’ve believed we had to be eco-conscious in our decisions and that we should promote it to our clientele. Ever heard of the word “greenvenient,” an amalgamation of green products and convenience? I not only coined it, but also trademarked it. And in 2015, the Environmental Protection Agency honored us with our first of three Safer Choice Partner of the Year Awards for our efforts.

Another way I’ve changed our culture at Jelmar is through the use of social media platforms. I didn’t wait for ROI numbers to be calculated; I jumped into new social marketing initiatives immediately. Now, we have nearly half a million engaged Facebook followers, all of whom share insights about themselves that help us become a part of their family — and them a part of ours.

A third initiative I spurred was our industrial division. Recognizing that we needed to diversify our portfolio of products, I urged the research and development team to create larger-sized options for substantial applications. As a direct consequence, we can now call distributors like Fastenal, Grainger, and HD Supply our clients.

I have little doubt that someday fathers will engage more purposefully with their daughters when considering which relative is best-suited to guide the family business legacy. Every family-run organization’s CEO seems to stay in the top spot for at least a couple of decades. In the near future as current leaders retire, we’ll hopefully see more fathers — and mothers — passing the keys to the corner office to their daughters.

Alison Gutterman is the president and CEO of Jelmar, the family-owned cleaning products manufacturer of CLR and Tarn-X products. She began her career at Jelmar in 1993 without a title or a desk, and in 2007, she was named president, bringing the company unprecedented success with her modern approach and leadership techniques. She also balances work with parenthood as a single mother of two children, and she resides in the greater Chicago area.

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